Why oil refineries are making contingency plans with a Sarnia, Ont., chemical plant shut down
Industry association says no immediate impact to production
Oil refineries in Sarnia, Ont., are piecing together contingency plans in case the shutdown of a chemical processing plant becomes a long-term closure.
Industry experts say those plans could include shipping benzene by rail or by water to customers in other markets because it can no longer be shipped by pipeline to INEOS Styrolution's Sarnia plant.
Ontario suspended a key approval required by INEOS to operate its plant after people in neighbouring Aamjiwnaang First Nation were rushed to hospital and treated for benzene exposure last month.
Benzene is linked to a wide range of acute and long-term health effects, including cancer and blood issues.
The chemical is a byproduct that occurs during the processing of crude oil for gasoline. That byproduct is used by INEOS to create styrene that is used to make plastics products.
'No immediate risk' to production of gasoline
Sarnia's petrochemical and refining complex is made up of dozens of chemical facilities and three refineries which, combined, is the second-largest cluster of its kind in Canada.
"In these clusters, typically the byproducts of one operation are the feedstock of another and so there's some codependency," said Greg Moffatt with the Chemistry Industry Association of Canada.
INEOS said there will be ripple effects felt by oil refineries in Sarnia now that the plant is shut down.
The order from Ontario prevents companies from moving benzene to INEOS through pipelines as of May 15 until the operation meets a number of requirements.
Moffatt said that raises two questions for companies that produce benzene.
"How much storage do these facilities have... and how quickly can they pivot to move the benzene that they have on site to other markets?"
A spokesperson for the Canadian Fuels Association said they're monitoring the situation in Sarnia.
"Refinery operators in the region are currently developing contingency plans to address and mitigate the impact of a potential long-term disruption," said Landon Tresise, a spokesperson for the Canadian Fuels Association.
"At this point, we are not aware of any immediate risk to continued safe production operations."
Industrial shutdown order rare in Sarnia
The closure of that operation first started as a voluntary decision by INEOS before the province suspended its Environmental Compliance Approval.
INEOS is on the government's technical standards registry for air pollution, which exempts it from complying with the annual air standard for benzene.
A technical standard review completed by the Ontario government last year found that if 90 micrograms of benzene is measured in a cubic metre of air 1 hour or 30 micrograms over 24 hours "then risks of an adverse effect (blood toxicity or hematotoxicity) are elevated."
Aamjiwnaang shut down its band offices and told people to work from home after an air monitor recorded a peak reading of 117.8 micrograms per cubic metre of air for an hour on April 16.
Days after an order was issued to INEOS by the province to reduce emissions following the voluntary shutdown, air monitors once again recorded benzene concentrations beyond the target.
Both the company and province have been criticized by Aamjiwnaang councillors who believe they've acted too slow and without their input as community members have gotten sick.
"This is not acceptable, nor is it an isolated event. Our community and our lands have become a sacrifice zone for the benefit of industry," said CJ Smith-White during a news conference ahead of a global plastics treaty negotiations event last month.
The INEOS facility has been in operation under different companies since the late 1970s.
"I've been through some really big challenges in the 80s and 90s with the industry and the province and sometimes the federal government," said long-serving Sarnia Mayor Mike Bradley, when asked about Ontario's actions.
"I've never seen this action before. It's a very clear and strong message."
Bradley has been critical of the company for not disclosing more information about the emissions and efforts to contain them.
"In general terms, the fact is, materials being made there are still part of the Canadian economy. There's still things happening there that are a benefit to Canadians. But then you get into that endless debate about the environment versus the economy. And right now, I would say the mood in general terms here is on the side of health and protecting people's health."
Aamjiwnaang declared a state of emergency last week and have set benzene emission readings that will trigger the closure of band offices and nearby baseball diamonds.
INEOS said it's considering appealing the provincial order and has maintained that its site monitoring systems have not detected emissions beyond prescribed limits.